The share price jumped ahead of Mr Schrempp's announcement

The body said it had "grounds" to suspect illegal dealing in the stock.

DaimlerChrysler's share price jumped 10% in late July ahead of chief executive Juergen Schrempp's decision to step down at the end of the year.

BaFin has since run a check on dealing in the stock before the news and found "possible illegal trades", it said.

'Something amiss'

Illegal or "insider" trading is when individuals buy or sell stocks on sensitive corporate information that has not been released to all shareholders.

We are asking all financial institutions to show us who bought or sold shares. Then we'll try to find links to people who knew of Schrempp's plans BaFin spokeswoman Sabine Reimer See DaimlerChrysler shares

If found guilty, individuals can face lengthy prison sentences.

However, no-one is being investigated yet, BaFin spokeswoman Sabine Reimer said.

She did say though that "the indications have hardened that something was amiss".

"We are asking all financial institutions to show us who bought or sold shares," she added.

"Then we'll try to find links to people who knew of Schrempp's plans."

Shares climb

On 28 July, shares in the automotive manufacturer opened at about 36.50 euros but climbed ahead of the news Mr Schrempp was to step down.

By the time of the official announcement, they had risen to 39.35 euros, a gain of nearly 8%.

They closed more than 10% ahead.

Dieter Zetsche, who led the resurgence of the company's US Chrysler Group, will replace Mr Schrempp at the head of the world's fifth-largest carmaker at the start of 2006.

The company has seen its earnings come under pressure as steel prices have increased and competitors have offered cut-price deals to lure customers.